Ad Hocs Level Turns Negative On Tax Inflows

The ad hoc treasury bills stood at Rs (-)1,175 crore on September 27 compared with Rs 325 crore in the week ended September 20.

Analysts attribute this to the advance tax inflow from corporates, which was Rs 8,000 crore, and a marked step-up in the government's repayment of loans to the central bank.

Simultaneously, the RBI credit to the government centre has also fallen during the week by Rs 4231 crore to Rs 124430 crore, signalling the decreasing dependence of the government on the central bank. The incremental ad hoc level also slipped to Rs 28,270 crore from Rs 35,390 crore during the week.

 

According to analysts, the government is using up whatever revenues they have earned. "Advance taxes amounting to Rs 8000 crore have come into the government coffers which it is now using," ICICI Securities debt analyst Aasish Pitale said.

This apart, analyts feel that the advance tax outflow is reducing monetisation of government debt.

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